THIS CONSULTING AGREEMENT IS ENTERED INTO ON 1ST SEPTEMBER 2004 BETWEEN STERLINGFCS LTD ("SFCS") AND ELECTRONIC GAME CARD INC. AND ITS SUBSIDIARIES ("CUSTOMER").
EXHIBIT 99.2
THIS CONSULTING AGREEMENT IS ENTERED INTO ON 1ST SEPTEMBER 2004 BETWEEN
STERLINGFCS LTD ("SFCS") AND ELECTRONIC GAME CARD INC. AND ITS SUBSIDIARIES
("CUSTOMER").
1. SERVICES. SFCS shall perform the consulting services described in
Schedule(s) mutually agreed upon, signed by both parties, and attached
hereto (the "Services"). Customer may at any time request a
modification to the Services agreed to between the parties by written
request to SFCS specifying the desired modifications to the same degree
of specificity as in the original specifications. SFCS shall submit an
estimate of the cost for such modifications within seven days of
receipt of such request, and if accepted by Customer, such change in
Services shall be performed under the terms of this Agreement.
2. PERSONNEL. SFCS shall appoint an Account Services Supervisor who will
assign resources both employees and subcontractors with qualifications
suitable for the work described in applicable Schedule. SFCS may
replace or change employees or subcontractors as required. For the term
of any Schedule and for 12 months thereafter, Customer agrees not to
solicit or retain the services of any person who is an employee of SFCS
and who was engaged in rendering services under such Schedule. While on
Customer's premises, SFCS's employees and subcontractors will comply
with all reasonable security practices and procedures generally
prescribed by Customer. SFCS will not be required to sign any waivers,
releases or other documents to gain access to Customer's premised in
connection with work performed under this Agreement and any such
waivers, releases, or other documents shall be invalid and shall have
no effect. It is understood and agreed that each of the parties hereto
is an independent contractor and that neither party is, nor shall be
considered to be, an agent, distributor or representative of the other.
Neither party shall act or represent itself, directly or by
implication, as an agent of the other or in any manner assume or create
any obligation on behalf of, or in the name of, the other.
3. FEES. As consideration for the duties performed by the Account Services
Supervisor and the assigned resources, Customer shall pay SFCS the fees
set forth in the applicable Schedule attached hereto. In addition,
Customer will reimburse SFCS for reasonable travel and living expenses
incurred by SFCS employees and subcontractors for travel from SFCS's
office in connection with the performance of this Agreement and any
other expenses contemplated in the applicable Schedule. With respect to
materials shipped by SFCS to Customer hereunder, Customer shall pay all
applicable shipping charges. With respect to the Services (including
any deliverables resulting from such Services), Customer shall pay all
applicable sales, use, personal property or similar taxes, tariffs or
governmental charges, exclusive of SFCS's net income and corporate
franchise taxes. SFCS shall invoice the Customer on a periodic basis as
shown in the applicable Schedule. The fees owing hereunder shall be
payable within 30 days from date of SFCS's invoice therefore, provided
that the work being invoiced was performed prior to the date of the
invoice. Past due amounts owing from Customer shall bear interest at
the rate of 1% per month. Customer will reimburse SFCS for all
reasonable costs incurred (including reasonable attorney's fees) in
collecting past due amounts owed by Customer. SFCS shall have the right
to halt or terminate entirely its services until payment is received on
past due invoices.
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4. TERM AND TERMINATION. This agreement shall commence as of the date set
forth above and shall continue, unless terminated as set forth herein.
Customer may at any time and for any reason terminate this Agreement or
any Schedule by providing at least six calendar months prior written
notice to SFCS after the second anniversary of this Agreement. SFCS may
terminate this Agreement upon written notice to Customer, if Customer
breaches this Agreement or any other agreement between SFCS and
Customer and fails to correct the breach within seven days following
written notice of such breach. Any termination as contemplated above
shall not affect the obligations of Customer to pay SFCS for work
performed prior to termination.
5. WARRANTY. SFCS WARRANTS THAT SERVICES PROVIDED TO CUSTOMER WILL
SUBSTANTIALLY CONFORM TO THE APPLICABLE SCHEDULE. THIS WARRANTY WILL BE
IN EFFECT FOR 90 DAYS FROM THE COMPLETION DATE SET FORTH IN THE
SCHEDULE. THE WARRANTY HEREIN IS EXCLUSIVE AND IN LIEY OF ALL OTHER
WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING THE IMPLIED
WARRANTIES OF MERCHNTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IF
SFCS IS UNABLE TO PERFORM THE SERVICES AS WARRANTED, CUSTOMER'S
EXCLUSIVE REMEDY, AND SFCS'S ENTIRE LIABIILITY, WILL BE THE
REPERFORMANCE OF THE SERVICES, OR IF SFCS IS UNABLE TO REPERFORM AS
WARRANTED, REFUND OF THE FEES PAID FOR THE DEFICIENT SERVICES.
6. CONFIDENTIALITY. The term "Confidential Information" shall mean any
information disclosed by either party (the "Disclosing Party") to the
other party (the "Receiving Party") in connection with this Agreement
which is disclosed in writing, orally or by inspection and is
identified as "Confidential" or "Proprietary". The Receiving Party will
only disclose Confidential Information to those of its employees and
contractors who have a need to know for the purpose of performing under
this Agreement. The Receiving Party will protect the confidentiality of
Confidential Information to the same degree if care, but no less than
reasonable care, as the Receiving Party uses to protect its own
confidential or proprietary information. The Receiving Party's
obligations regarding Confidential Information will expire no less than
two years from the date of receipt of the Confidential Information. The
obligations set forth in this paragraph will not apply to any portion
of the Confidential Information which: (a) was independently developed
by the Receiving Party without any use of the Confidential Information
of the Disclosing Party and by employees or other agents of (or
independent contractors hired by) the Receiving Party who have not been
exposed to the Confidential Information; (b) becomes known to the
Receiving Party, without restriction, from a third party without breach
of this Agreement who had a right to disclose it; (c) was in the public
domain at the time it was disclosed or becomes in the public domain
through no act or omission of the Receiving Party; (d) was rightfully
known to the Receiving Party, without restriction, at the time of
disclosure; or (e) is disclosed pursuant to the order or requirement of
a court, administrative agency, or other governmental body; provided,
however, that the Receiving Party shall provide prompt notice thereof
to the Disclosing Party and shall use its reasonable best efforts to
obtain a protective order or otherwise prevent public disclosure of
such information. Notwithstanding the foregoing, this Agreement is not
intended to prevent the Receiving Party from using Residual Knowledge,
subject to any valid patents and copyrights of the Disclosing Party.
"Residual Knowledge" means ideas, concepts, know-how or techniques
related to the Disclosing Party's technology and Confidential
Information that are retained in the unaided memories of the Receiving
Party's employees who had rightful access to Confidential Information.
An employee's memory will be considered unaided if the employee has not
intentionally memorized the Confidential Information for the purpose of
retaining and subsequently using or disclosing it.
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7. INSURANCE. SFCS will maintain at its sole expense general liability
(including, but not limited to, automobile liability) and workers'
compensation insurance covering the performance of Services by SFCS and
any subcontractor or other party engaged by SFCS engaged by SFCS
therefore.
8. ARCHIVAL COPY. Upon completion of the Services or termination of this
Agreement, SFCS may, but shall not be required, to keep one copy of any
Customer-owned deliverables, including but not limited to, the plans,
designs, specifications, implementations, reports, screen designs,
financial budgets and projections, and notes and any related materials.
SFCS warrants that the copy and any copies which SFCS makes shall not
be sold, licensed, sublicensed or in any way disseminated to third
parties.
9. LIMITATION OF LIABILITY. EXCEPT FOR BREACH OF THE CONFIDENTIAL
INFORMATION OBLIGATIONS HEREIN AND FOR PERSONAL INJURY AND PROPETY
DAMAGE CAUSED BY THE INTENTIONAL OR NEGLIGENT ACTS OF SFCS EMPLOYEES
WHILE PERFORMING ON THE PREMISES OF CUSTOMER, THE LIABILITY OF SFCS AND
ITS SUBCONTRACTORS TO CUSTOMER FOR CLAIMS RELATED TO THIS AGREEMENT,
WHETHER FOR BREACH OR IN TORT, SHALL BE LIMITED TO THE FEES PAID BY
CUSTOMER UNDER THE APPLICABLE SCHEDULE RELATED TO THE CLAIM. IN NO
EVENT WILL SFCS OR ITS SUBCONTRACTORS BE LIABLE FOR ANY INDRECT,
PUNITIVE, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGE IN CONNECTION
WITH OR ARISING OUT OF THIS AGREEMENT (INCLUDING LOSS OF PROFITS, USE,
DATA OR OTHER ECONOMIC ADVANTAGE), HOWEVER IT ARISES, WHETHER FOR
BREACH OF THIS AGREEMENT, INCLUDING BREACH OF WARRANTY, OR IN TORT,
EVEN IF SFCS HAS BEEN PREVIOUSLY ADVISED OF THE POSSIBILITY OF SUCH
DAMAGE. THIS SECTION SHALL SURVIVE TERMINATION OF THIS AGREEMENT.
Notwithstanding the foregoing, if SFCS is required, by a third party
subpoena or otherwise, to produce documents, testify or provide other
evidence regarding the services or this agreement in any investigation
or legal proceeding to which the Customer is party and SFCS is not a
party, Customer shall reimburse SFCS for all costs and expenses,
including the time of its professional staff at SFCS' standard rates
and the cost of legal representation, which SFCS reasonably incurs to
respond or comply.
10. GENERAL.
10.1. For the purpose of this Agreement, SFCS is an independent
contractor, and neither party shall be deemed the agent of the
other. All persons employed by SFCS shall be its employees or
subcontractors and shall not be deemed employees of the
Customer. SFCS assumes exclusive liability for all
contributions, taxes or payments required to be made because
of such employees or subcontractors by the federal and state
Unemployment Compensation Acts, Social Security Acts and all
amendments thereto, and by all other current and future acts,
federal or state, in whichever appropriate National
jurisdiction, requiring payment by SFCS on account of such
employees or subcontractors performing the Services under this
Agreement.
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10.2. This Agreement may not be assigned by either party without
prior written consent of the other party, except that SFCS
shall have the right to assign its rights to payment hereunder
and may assign this Agreement to an affiliated party.
10.3. This Agreement, together with the schedules and addenda
hereto, and purchase orders issues hereunder, constitute the
entire agreement of the parties and supersede all previous and
contemporaneous communications, representations, understanding
or agreements with respect to the subject matter hereof. This
Agreement may be modified only in a writing designated as an
amendment and signed by both parties. In the event of any
inconsistency between this Agreement and a purchase order,
this Agreement shall prevail unless expressly otherwise agreed
by the parties in writing. Purchase orders shall be binding
upon SFCS only if consistent with this Agreement with respect
to: the designated services ordered and fees therefore;
payment terms; site for performance of services; and delivery
dates set forth on the face side of or a special attachment to
the order. Printed terms on or attached to any such purchase
order shall be void and of no effect.
10.4. No delay, failure or default in performance of any obligation
of either party hereunder, excepting all obligations to make
payments hereunder, shall constitute a breach of this
Agreement to the extent caused by events or conditions beyond
that party's reasonable control. The failure or delay by
either party to enforce the terms of this Agreement shall not
be deemed a waiver of such term.
10.5. All notices relating to this Agreement shall be in writing and
delivered by courier or hand and sent to the other party by
first class prepaid mail with return receipt requested, to the
address of such party specified below or specified by such
party in accordance with this Section.
10.6. This agreement shall be governed by the laws of England. This
notwithstanding, either party may apply to a court of
competent jurisdiction for injunctive or equitable relief. If
any provision of this Agreement is held by a court of
competent jurisdiction to be unenforceable, such
unenforceability shall not affect the enforceability of the
remaining provisions of this Agreement, and the parties shall
substitute for the affected provision an enforceable provision
which approximates the intent and economic effect of the
affected provision as closely as possible.
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In witness whereof the parties have caused this Agreement to be
executed by their respective authorised representatives.
FOR STERLING FCS LIMITED:
By: /S/ XXXX X X XXXXX
--------------------------------
Title: ______________________________
Date signed: 1st September 2004
Address: Suite F8 International Commercial Centre Casemates Gibraltar
FOR CUSTOMER:
By: /S/ XXXXXX X. XXXXX
---------------------------------
Title: ______________________________
Date signed: 1st September 2004
Address: Xxxxxxxx Xxxxx, 00 Xxxxxxx XX Xxxxxx, Xxxxxx, XX0X 0XX
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STERLING FINANCIAL & CORPORATE SERVICES
PROFESSIONAL & GENERAL LIMITED CONSULTING
AGREEMENT SCHEDULE
Company Financial and Secretarial Services
This Consulting Agreement Schedule ("CAS") dated 1st September 2004 describes
the company financial and secretarial services to be performed by Sterling
Financial and Corporate Services ("SFCS") for Electronic Game Card Inc and its
subsidiaries ("Customer"). This CAS is subject to the Consulting Agreement
between Electronic Game Card Inc and SterlingFCS Limited.
A. PROCESS
The Customer is a relatively new business which lacks a financial
accounting, banking and company secretarial infrastructure. The
Customer wishes SFCS to design, implement and maintain such an
infrastructure as the Customer's business grows. Once this
infrastructure is in place it is expected that SFCS will provide a full
Chief Financial Officer ("CFO") and Company Secretarial service to the
Customer.
This agreement confirms SFCS' understanding of the terms and objectives
of this engagement and the nature and limitation of the services to be
provided.
B. SCOPE OF SERVICES
SFCS will provide Customer with a single point of contact that will be
responsible for coordinating SFCS resources, including appropriately
qualified personnel, to fulfil an interim CFO and Company Secretary
function. The point of contact will be based at SFCS' offices in London
and will be responsible to the Customer's Chief Executive for
day-to-day work instructions. It is envisaged that the role will adapt
overtime and will include some or all of the functions listed below:
Financial infrastructure design and installation:
o Establish banking facilities
o Set-up financial modelling, projections, and company and
product valuations from Customer supplied statistics, and from
a biotechnology perspective
o Rapid implementation of best- of-breed financial software
system
o Immediate book-keeping, cash control and operating budgets
o Advising on suitable insurance packages and banking facilities
for both business and management
o Developing and implementing internal accounting policies and
procedures
o Development of corporate governance procedures and management
of the observance of these procedures
Financial:
o Overseeing all aspects of the finance function
o Preparation of GAAP compliant SEC and UK financial statements
o Financial modelling and projections
o Working with management to develop and execute the business
plan
o Developing reporting packages suitable for management and the
board
o Issuing monthly, quarterly and annual financial statements
o Establishing and maintaining policies and procedures
o Handling financial related correspondence
o Functioning as the key finance member of the management team
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o Recording vendor invoices
o Generating customer billing
o Managing and recording payroll
o Preparing and posting all journal entries to the general
ledger
o Maintaining fixed asset ledgers
o Coordinating and executing all aspects of the CPA firm audit
o Providing access to specialized resources such as U.S. and
U.K. treasury and taxation experts
o Advising on suitable insurance packages for both business and
management
o Provision and management of banking facilities
Company Secretarial:
o Involvement in the preparation of GAAP compliant SEC and UK
financial statements
o Responding to SEC, and other regulators, comments and queries
o Corporate filings in both U.K., Companies House, and U.S.
state and federal environments
o Developing and implementing internal accounting policies and
procedures to expedite future reporting
o Development of corporate governance procedures and management
of the observance of these procedures
o Performing the quarterly and/or annual/bi-annual close
o Assisting in developing management discussion and analysis and
disclosures for 10-K and 10-Q Forms
o Developing high-quality, independent reporting packages for
the board and/or senior management
o Providing liaison between client and stock transfer agent for
shareholders
o co-ordination and recording of board meetings
C. PERSONNEL, FEES, EXPENSES AND PAYMENTS
X X Xxxxx or another person by agreement with the company will act as
Chief Financial Officer and will be the Account Services Supervisor, he
will allocate appropriate SFCS resources as he sees fit to undertake
the services to be provided in Paragraph B hereof and will be
compensated at a combined fee of $12,500 per calendar month (the "Fee")
exclusive of expenses, to be accounted to the Customer on an as
incurred basis, and exclusive of VAT or other taxes, where applicable,
and invoiced monthly in arrears. Standard payment terms are 30 days
upon issue of invoice. The Fee shall be reviewed by agreement or upon
each anniversary of this Agreement. Additional fees will be chargeable
for projects and exceptional services. SFCS shall commence performance
of the Services on the date hereof, and the project shall last for two
years with either party being able to terminate without penalty with
six months notice one year from the date hereof.
AGREED AND ACCEPTED:
Sterling FCS Ltd
By: /S/ XXXX X X XXXXX
--------------------------------
XXXX X X XXXXX
Title:
Date signed: 1st SEPTEMBER 2004
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